The First Home Super Saver (FHSS) scheme helps first home buyers save money faster. You can use some of your super contributions to buy your first home.
How It Works
You make extra contributions to your super fund. Later, you can take out these contributions plus earnings to buy your first home.
The government taxes super contributions at only 15%. Depending on how much you earn, this may be less than your normal tax rate. You also get a 30% tax offset when you withdraw the money.
How Much You Can Save
You can contribute up to $15,000 per year. The total limit is $50,000 across all years.
When you withdraw:
- You get 100% of after-tax contributions back
- You get 85% of before-tax contributions back (like salary sacrifice)
- You also get earnings on both types of contributions
Who Can Use It
You must be 18 or older. You must have never owned property in Australia before. This includes investment properties, vacant land, or commercial property.
Your name must be on the property title. You must plan to live in the property as your main home.
You don’t need to be an Australian citizen to use the scheme.
What You Can Buy
You can buy or build a home in Australia. The property must be suitable for living in.
You cannot buy:
- Vacant land on its own
- Houseboats
- Motor homes
- Commercial properties
Types of Contributions That Count
Eligible contributions:
- Salary sacrifice contributions (made after 1 July 2017)
- Personal contributions you claim as tax deductions
- After-tax personal contributions
Not eligible:
- Employer super guarantee contributions
- Contributions made before 1 July 2017
- Government co-contributions
- Contributions from family members
The Process
Step 1: Make extra super contributions
Step 2: Request a determination from the ATO
Step 3: Request release of your super savings
Step 4: Sign your property contract
Step 5: Notify the ATO within required timeframes
Step 6: Receive your money
Important Timeframes
You must request your determination before you buy the property. After you get the money, you have 12 months to sign a contract to buy or build a home.
If you don’t buy a home, you must either:
- Put the money back into super, or
- Pay extra tax (20% of the amount)
Tax Implications
The money you withdraw counts as income in your tax return. You pay tax on it at your normal rate. But you get a 30% tax offset to reduce the tax.
The ATO will withhold some tax when they pay you the money. This helps cover your tax bill.
Things to Consider
Check that your super fund will release FHSS amounts. Ask about any fees or charges.
Make sure your super fund has your correct contact details. The details must match what the ATO has on file.
The scheme isn’t right for everyone. Consider getting financial advice before starting.
State Government Concessions
You can use the FHSS scheme alongside other first home buyer concessions from state governments. Check with your state government about their specific programs.
Getting Started
Log into myGov and access ATO online services. Go to Super, then Manage, then First Home Saver.
You can check your eligible contributions with your super fund at any time. This helps you track how much you can withdraw.
Remember to start the process early. It can take 15-20 business days to receive your money after requesting it.
Ready to Buy Your First Home?
Once you’ve saved through the FHSS scheme, make sure you choose the right property. Did you check this property?
Get instant access to zoning information, transport options, and property risks before you make your next property decision at Checkthisproperty.com.au.
Understanding your property’s zoning, transport links, and potential risks is just as important as saving for your deposit. Make informed decisions with comprehensive property insights.
This information is general in nature. Consider seeking professional financial advice for your specific situation.